Emerging markets Argentina and Turkey: mission impossible?
High international debt exposures, large deficits and institutional frailty have fuelled capital outflows, weaker currencies and soaring inflation in Argentina and Turkey
Against a backdrop of solid growth in advanced economies and rising interest rates in the US, both Argentina and Turkey suffered sharp capital outflows in 2018. Even as the tide turned earlier this year, when weaker growth forecasts and trade tensions resulted in the US Federal Reserve abandoning its plan for three interest rate rises in 2019, both nations remain vulnerable. But the pause may offer a chance for some action.
Argentina and Turkey are especially weak emerging economies because of
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